McCarthy v. State, 8037

• Decision Date: 22 December 1953
• Docket Number: No. 8037,8037
• Parties: d 205, 49 A.L.R.2d 1031 McCARTHY, v. STATE et al.
• Court: Utah Supreme Court

Page 387

265 P.2d 387

1 Utah 2d 205, 49 A.L.R.2d 1031

McCARTHY, v. STATE et al.

No. 8037.

Supreme Court of Utah.

Dec. 22, 1953.

Pugsley, Hayes & Rampton, Harry D. Pugsley, Salt Lake City, for appellant.

C. E. Henderson, Joseph S. Quinney, Irwin Clawson, Robert B. Porter, Athod Rawlins and Robert Murray Stewart, Salt Lake City, for respondents.

CROCKETT, Justice.

Plaintiff, Daniel McCarthy, appeals from an order of dismissal entered by Third District Judge David T. Lewis, which he based upon the ground that a prior judgment of dismissal in the U. S. District Court for Utah was res judicata of this action.

The controversy arose out of a contract by which Mr. McCarthy undertook to do certain work upon a monument at the mouth of Emigration Canyon commemorating the arrival of the Mormon Pioneers in Salt Lake Valley. The other contracting party was the 'This is the Place Monument Commission,' a committee of citizens appointed by the Governor of Utah to plan, raise funds for, and erect such monument. Their appointment was made pursuant to a recommendation by joint resolution of the state legislature. In 1939, and again in 1945, the legislature appropriated moneys to supplement that received by the Commission through private subscription. The legal status of the Monument Commission and its relationship to the State of Utah in carrying out the desires of the legislature and the Governor were not clearly defined. The Commission conducted a public solicitation of funds, received and expended its legislative appropriations, and proceeded to have the monument erected.

Dispute developed over the work done by plaintiff, one of the contractors, and the payment therefor. In May, 1948, he started an action in the U. S. District Court against the Monument Commission, characterizing it as a 'voluntary association,' and also against its members individually. They interposed the defense that neither the 'association' nor its individual members were responsible under the contract, averring that they were simply acting for the State of Utah which was the real party in interest. The Federal Court sustained this contention, and held that as a consequence thereof it had no jurisdiction of an action by plaintiff against the State of Utah ¹ and dismissed it. The time to move for a new trial and for appeal has elapsed and such judgment is final.

About 9 months later, in December, 1950, plaintiff instituted the present suit against the State of Utah, the Monument Commission, its executive secretary, and the members individually in the Third District Court of this State. Responsive to proper motions the action was dismissed as against the State because it had not consented to be sued, and as to the other defendants on the ground that the Federal Court had already made a final determination that such defendants were not the real parties in interest and were not personally responsible.

Plaintiff contends that inasmuch as the Federal Court dismissed the case for lack of jurisdiction, the rule of res judicata is not applicable. He cites Hutton v. Dodge ² wherein we announced the general rule that a judgment becomes res judicata only when the court has acquired jurisdiction over the subject matter and the parties. This rule is grounded upon the sound principle that litigants are entitled to have an adjudication upon the merits. It must be conceded that in most instances, if a tribunal has no jurisdiction, there is no trial on the merits. However, it is not open to question that a judgment of dismissal for want of jurisdiction is conclusive as to the matters upon which the ruling was necessarily based. ³ In American Surety Co. v. Baldwin, ⁴ Mr. Justice Brandeis stated: 'The principles of res judicata apply to questions of jurisdiction as well as to other issues.' No reason is apparent why the rule should be less applicable to a decision denying jurisdiction than to one sustaining it. ⁵

In the instant case, the conclusion that the Federral Court lacked jurisdiction was necessarily based upon a determination of the critical issue, i. e., that the individual defendants were not personally responsible under the contract. The other jurisdictional facts were present: The amount exceeded $3,000; there was diversity of citizenship between Mr. McCarthy, a resident of California and the other individual defendants, who were residents of Utah. The question whether the latter were responsible under the contract and therefore proper parties defendant was the one which was tried, argued and submitted to the Federal Court. The only logical deduction that can be drawn is that such was the ground for its order of dismissal. And this is true notwithstanding the fact that the court made no such written finding. The issue having been squarely presented and determined, it is res judicata as between these parties.

Plaintiff also challenges the State Court's summary judgment of dismissal as violative of Rule 56(c) U.R.C.P. which requires the court to give full consideration to the affidavits filed by the parties, urging that plaintiff's affidavit set forth facts which demonstrate that the Commission was not an agency of the State and that the individuals were...